Miners lead JSE retreat from highs

The JSE closed weaker amid mixed global markets as concern over China’s tech crackdown and rising Covid-19 infections weighed on sentiment at the end of the week. The JSE all share was pulled lower on Friday by miners after closing at a record high on Thursday.

The JSE closed weaker amid mixed global markets as concern over China’s tech crackdown and rising Covid-19 infections weighed on sentiment at the end of the week.

The JSE all share was pulled lower on Friday by miners after closing at a record high on Thursday as markets cheered the US Federal Reserve’s dovish stance. Global markets were lifted to record highs on Thursday after the Fed held interest rates near zero and maintained its asset purchases at $120bn a month until “substantial further progress” is made on employment and inflation.

Global stock markets turned negative on Friday, however, with big tech companies under pressure as risks from China’s regulatory crackdown on the sector weighed on sentiment.

“There’s a definite shift in demeanour, with the crackdown in China coming back to haunt us at the close of the week.

“That might stall the recovery in Naspers and Prosus, which have retraced some of the losses suffered earlier in the week,” said RMB market analyst Deon Kohlmeyer.

Tencent, in which the Naspers stable is the largest single shareholder, with 29%, fell 2.64% to HK$479 on Friday. Naspers relinquished 1.31% to R2,822 and Prosus 1.18% to R1,302. Naspers ended the week with losses of 4.68% and Prosus gave up 6%.

“A combination of factors may be driving investor sentiment, including a Delta dip as Covid-19 cases rise in most parts of Asia. All in all, it looks as though investors are taking risk off the table over the weekend,” said Oanda senior market analyst Jeffrey Halley.

“With sentiment remaining fragile, despite some stabilisation on Thursday, the fast-money herds don’t need much to spook them.”

The JSE all share lost 0.85% to 68,970 points and the top 40 0.86%. Both were still up more than 4% in July, with the all share now 16% higher since January 1.

Industrial metals fell 2.33% and resources 1.98%. Banks gained for a fourth successive day, up 1.04%.

Anglo American led losses among the larger diversified miners, falling the most in two weeks, down 2.72% to R653.59. BHP lost 2.18% to R473.67 and Glencore 2% to R66 .

At 5.40pm, the rand had weakened 0.25% to R14.6031/$, while it was flat at R17.3485/€ and R20.3507/£. The euro lost 0.21% to $1.1862.

Gold gave up 0.33% to $1,821.30/oz and platinum 1.59% to $1,043.92. Brent crude shed 0.78% to $75.28 a barrel.